I have a public provident fund - ppf - account. For saving income tax, it has proved to be very convenient. I opened it in 1990 and continue to use it. An account runs for 15 years and after that, extension for 5 more years is possible. There is no upper limit to the number of extensions.
I transferred the account to my bank from State Bank of India to make operating it even more convenient.
My bank's staff has always had some trouble over this account, I don't know why. I have been able to persuade them to paper things over because there is nothing wrong from my side.
A few months ago, I had this bright idea of withdrawing funds from this account and investing them in shares for getting better returns. PPF currently pays 7.9% annual interest and bank fixed deposit rates hover around 5.4%.
Regular withdrawal from ppf is possible and there is a formula that is used to work out the withdrawal amount. I went to the bank two months ago and found out how much I could withdraw.
Recently, on a trip to the bank, I enquired about a withdrawal form. They did not know and told me to use the ordinary withdrawal slip for regular bank accounts. I filled it in but on presenting it, I was told to wait. They made enquiries with the zonal office, were told there was a separate form but they did not have any. I was asked to go again the next day. To my relief, the concerned officer phoned me to say that the form had arrived.
I trooped down with revenue stamps and my passbook. I was told to withdraw a small sum, a round amount.
"There is some problem with your account. In one of the years, you did not make any payment."
"Not possible. I have been religiously using the account for depositing money."
"Our computer says it is so."
"Is there some problem? Withdrawals are common."
"This is the first case of partial withdrawal I am handling."
I rolled my eyes.
"Because of the alert on our screen, you will have to close down your account."
"Look, I have checked with my investment advisor and he has confirmed that an account can be extended any number of times. There is no ceiling."
"No, that is not correct."
"Who says so?"
"I am saying so. You just wait."
I did and I could see two officers consulting each other gravely. After a while I was told to submit my completed withdrawal form. Had it been account closure, the amount would have been double of my withdrawal. So the officer had tacitly taken back his words. He said he would carry out the transaction.
"Thank you. When will I get my passbook back?"
"It will stay with us." He punched it and filed it.
"How come? I still have a large amount of money in the account. The passbook is my record."
I came back home. After 4 hours, there was a message and a phone call saying that the withdrawal had gone through and I could collect the updated passbook. I promptly pocketed it.
It is my hard-earned money but the bank appears to have some claims over it!!
